Top Down Analysis Of ETHUSDT Using Support And Resistance Strategy And RSI Indicator As Confluence

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Hello great minds,

It is a great opportunity to come before you all today to share my technical analysis on eth against usdt.

I believe you are all doing perfectly well and are enjoying your activities in the community as you actively promote steemit across various social media platform.

Ethereum is a very big cryptocurrency in the cryptospace and we are well aware of this.

Ethereum happens to be the second most biggest and popular cryptocurrency in the cryptospace.

After Bitcoin which is the driver of all other tokens, ethereum is known to be the next most valuable token, and I am here to share my analysis to it.

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ANALYSIS USING SUPPORT AND RESISTANCE STRATEGY

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I begin my technical analysis from the higher timeframe, then I descend to the lower timeframe

On the higher timeframe, ideally the monthly timeframe, I seek to determine market trend

The monthly timeframe helps to eliminate market noise from the market and also compress the market to one screen.

And from this, it becomes very easy for the market trend to be predicted.

The screenshot above is that of the pair ethusdt on the monthly timeframe.

And as seen above, there are lesser candles on this timeframe and this is as a result of the time it takes for one of this candles to be formed.

On the monthly timeframe, it takes the time period of 1month for each candle to be formed.

And also, it is easy for the overall trend of the market to be detected on this timeframe, as we can see that the market is being bullish.

And getting to the weekly timeframe, I could see the market more clearly.

There are more candlestick on this timeframe than on the monthly timeframe, and this is because each candle on this timeframe is formed after a market period of 7days.

And looking carefully, I was able to spot a key level on the market, and this level is functioning as a resistance level to the market, and the market is expected to be rejected when its trades towards this level.

And getting to the daily timeframe, I could feel the presence of the buyers and sellers as they struggle to drive the market to their preferred direction.

And looking carefully, I was able to spot a key level and this level is functioning as a support level to the market.

This level is a valid level as it has been severally tested and respected by the market, even the latest bulllish leg of the market is as a result of the rejection from this level.

I then continued my analysis by moving to the 4hr timeframe, and on this timeframe, i noticed that the market is more noisy, than other higher timeframes.

And I looked carefully and was able to spot a key level, and this level use to function as a resistance level untill it was broken by the market, and Is now functioning as a support level.

And from the above screenshot, we can see that the market has retraced to retest this broken level, and from this, we can see a bullish rejection on the market.

Inorder to see the market more clearly, I continued my analysis on the 2hr timeframe.

On this timeframe, I was able to zoom into the chat and get a better understanding of the price movements.

With this structure of the market, u developed a bullish bias on the market, and I decided to search for trading confluence using the relative strength index indicator.

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CONFLUENCE USING RELATIVE STRENGTH INDEX INDICATOR

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The relative strength index indicator is an indicator that helps to identify overbought and oversold market.

When a market is spotted to be overbought, it is a bearish trend reversal signal and when it is oversold, it is a bullish trend reversal signal.

An overbought market can be spotted when the rsi crosses above the 80% line and an oversold market is detected when the market crosses below the 20% line.

Applying the rsi to the monthly timeframe I noticed that the rsi has crossed above its 80% line, and this is an indication that the market is being overbought.

An overbought market is one that signals the change in market strength from the buyers to the sellers, that is, it signals a bearish trend reversal of the market.

And from this, we can expect to see a momentary bearish move of the market.

Getting to the daily timeframe, I noticed that the rsi indicator has crossed above its 80% line again, indicating that the market is being overbought.

And as explained, an overbought market signals the strength of the bears as they are about to drive the market downwards.

Then I'll continued to the 2hr timeframe in search of entry into the market.

And getting to the 2hr timeframe, I noticed that the rsi has crossed below its 20% line.

And this is an indication that the market is being oversold, and as such, we should expect a bullish trend reversal of the market.

This signal is in alliance with my analysis using support and resistance strategy, and as such, I decided to place an entry into the market.

I entered the market from its closest support level and my take profit was set on the closest resistance level to the market, just as seen above.

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CONCLUSION

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I have shared my analysis on ethusdt beginning from the monthly to the weekly to the daily and to the hourly.

From my analysis, I expect to see a bullish move on ethusdt.